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Possible monetary policy changes could weigh on inflation, economist says🚨🚨🚨
According to Odaily, Bank of America economist Stephen Juneau highlighted in a report to clients on Thursday that upcoming potential policy changes could put upward pressure on prices. These changes include higher tariffs, deficit-financed tax cuts, and stricter immigration policies. Juneau noted that because of these policy changes, the core personal consumption expenditure (PCE) inflation rate is unlikely to decline significantly over the next two years.
At the next meeting, the Federal Reserve is expected to acknowledge the lack of progress in controlling inflation. Juneau suggests that the Fed could pause interest rate cuts in January of next year. He also warned that policy changes during a possible second term of President Trump could prolong this pause. The economist's remarks underscore the challenges the Federal Reserve faces in controlling inflation amid evolving economic policies.
